A New Golden Age Of Philanthropy: What’s Driving Next-Gen Giving?
Northwestern MutualVoice Team
December 2, 2014
We all know that Facebook founder Mark Zuckerberg is one of the richest Americans today. According to the Chronicle of Philanthropy, he is also one of the most generous.
Along with his wife, Priscilla Chan, Zuckerberg donated 18 million shares of Facebook stock—worth a whopping $992.2 million—to the Silicon Valley Community Foundation. At only 29 years old, Zuckerberg is the youngest person ever to top the Chronicle of Philanthropy’s list of the 50 most generous donors; he is also part of what some are calling a new golden age of philanthropy.
In fact, scholars estimate that these younger Americans stand to inherit more than $40 trillion in wealth and create trillions more in their lifetimes. Much of that will be designated for charitable giving, according to nextgendonors.org. With the potential for unprecedented resources and more diverse ways than ever to engage in charitable giving, many expect the next generation of major philanthropists—those who fit into “Gen X” (born 1964–1980) or “Gen Y” (born 1981–2000)—to transform charitable giving itself.
To understand how, consider what these younger Americans said in a recent survey about giving and its role in their lives. That survey, NextGenDonors: Respecting Legacy, Revolutionizing Philanthropy, was conducted jointly by 21/64, an organization that studies generational giving, and the Dorothy A. Johnson Center for Philanthropy.
1. They want to leave their own mark on society. The next generation of donors has grown up with strong philanthropic values, yet many are already doing more than simply following in their parents’ footsteps. The NextGenDonors survey found that while 90 percent of respondents cited their parents as their model for philanthropy, younger donors plan to meet that commitment in somewhat different ways in the future. For many this means exploring new philanthropic and investing tools. Not surprisingly, it also means a greater reliance on social media and the Internet to learn about issues, causes and organizations that need their help, connect with fellow donors and conduct charitable activities online.
2. They network for greater results. As you would expect, today’s youngest philanthropists are highly networked. They enjoy sharing knowledge and experiences with their peers and believe that collaboration not only makes them all better donors, but also multiplies the impact of their gifts.
3. They’re “all in.” Next-Gen donors want to be actively engaged in their giving. “They want to develop close relationships with the organizations or causes they support. They also want to listen and offer their own professional or personal talents, all in order to solve problems together with those whom they support.” This desire for a higher level of direct contact differs from prior generations, which are generous in their giving but tend to take a more hands-off approach to funding.
4. They have a sense of immediacy. Participants in the NextGenDonors survey expressed a deep interest in helping and applying their skills in the here and now. This is in sharp contrast to older donors, who tend to wait until they’re older to decide who they are as philanthropists and what legacies they want to leave.
5. They’re flexible in their approach. When asked how their approach to funding differs from their parents’ and grandparents’, survey participants noted that younger donors are more likely to approach their giving from the standpoint of problems to be solved rather than institutions to be supported. This may lead them to research not only non-profit organizations but also individuals and for-profit companies that are tackling the issues they’re passionate about.
Of course, no one knows what impact this new wave of philanthropists will have on charitable organizations in the years to come. But one thing is certain: With their philanthropic values and online expertise, these young donors are already making a difference. With time and experience, they are on track to carry forward America’s most cherished tradition of giving.
The Northwestern MutualVoice Team is a group of professionals who share insights and opinions from experts and industry leaders across the enterprise. Our vision is to inspire others to take action and plan for their financial future through topics ranging from financial planning, retirement planning and distribution strategies, wealth accumulation and preservation, to leadership, philanthropy and innovation.